This article explores empirically the assertion that Islamic Banks have higher credit risk than Conventional Banks. A definition, identification and the way to manage credit risk are given to each Islamic financial tool. This risk is, then, measured on nine Islamic and nine Conventional Banks,...

This empirical study examines the stability of Islamic banks during the subprime crisis. It covers a sample of fourteen Islamic banks and fourteen conventional banks. The conditional variance (volatility) of returns was used to measure stability. The E-GARCH and GJR-GARCH asymmetric models were...

The article deals with the issue of liquidity management for Islamic banks. Based on data extracted form Bankscope, it is shown that Islamic banks suffer from excess liquidity. This liquidity can not be invested using conventional means because of Shari'ah considerations. In the other hand,...

BCBS, in its response to the last financial crisis, has introduced deep reforms to the regulatory requirements on capital adequacy for banks (Known as Basel III). Buffers and a leverage ratio were introduced to cater those banks with sufficient high quality capital during a stress period. But...

Purpose – The purpose of the paper is to construct a framework constituting a link between Islamic banks’ excess liquidity and states’ financing needs, in an Islamic way.evel0. Design/methodology/approach – The framework, constituting a linkage between Islamic banks’ funding capacity...